Yahoo rallies in pre-open

Amazon, Microsoft, Cisco edge up; futures gain

EmilyChurch

NEW YORK (CBS.MW) - Shares of Yahoo extended its post-Christmas rally in light, pre-open trading Friday, after SBC said it would take a stake in the company.

Elsewhere, tech stocks were generally higher as stock futures indicated a positive start to the second-to-last trading day of the year.

Yahoo keeps going

Yahoo
YHOO
rose 83 cents, or 4.7 percent, to $18.60, after tacking on 6.6 percent in the previous two sessions. SBC Communications
SBC, +0.07%
said Thursday it's buying a 3 percent stake in the portal from Softbank America as the telecommunications giant moves to solidify its DSL Internet alliance with Yahoo. See full story.

Separately, Analyst Henry Blodget at Merrill Lynch raised his fourth-quarter revenue estimate for the Web portal due to his increased confidence in the Web portal's ability to gain share in the online advertising market, which he feels has stabilized.

He added that Yahoo's stock is "less expensive than it looks," given the company's off-balance sheet assets and the possibility that a potential "suitor" may emerge.

Amazon outlook

Amazon.com
AMZN, +1.24%
tallied a 50-cent, or 4.7-percent gain, to $11.10. Before pulling back 50 cents on Thursday, the stock had soared $1.27, or 13 percent the day after Christmas on signs of strong holiday sales. The online retailer Thursday said it recorded 37.9 million items sold from Nov. 9-Dec. 21, a 36 percent rise over the last year.

Amazon.com looks to remain "on-track to sell roughly 54 million items during the fourth quarter," up from an estimated 41 million items sold in the December quarter last year, Robertson Stephens tells clients overnight.

Still, analyst Lauren Cooks Levitan says Amazon's long-term outlook remains murky. For the fourth quarter, she said, "we also believe the potential for significant revenue upside remains unlikely given Amazon's various revenue share agreements with its service partners and fixed revenue structure in its used business."

Microsoft edges up

Pre-open investors took shares of Microsoft
MSFT, +1.25%
up 35 cents to $68.20. The software behemoth said 38 different games will be available for play on its new Xbox game console by the end of the year, above its previously-stated target of 30 games. The company boasted that the number was "nearly double" the number of games available for Nintendo's new GameCube console, which was released in the U.S. at roughly the same time as the Xbox.

Stock futures eke out gains

U.S. stock futures indicated investors are leaning toward a positive open. March 2002 S&P futures tacked on 4.40 to 1,163.90, which was about 5 1/4-points above fair value. Nasdaq 100 futures were up 14.50 at 1,628.00.

Nanometrics clubbed

Shares of Nanometrics
NANO, +2.32%
slumped $3.50, or 14 percent, to $21.40 after the chip equipment firm said it expects fourth-quarter revenue to fall short of expectations. The company is now projecting a sequential revenue decline of 25 percent, down from its previous outlook for a flat performance with its third-quarter total of $10.1 million. Nanometrics attributed the shortfall to continuing overcapacity in the chip industry and the economic weakness in the U.S. and Japan.

Intraday Data provided by SIX Financial Information and subject to terms of use. Historical and current end-of-day data provided by SIX Financial Information. All quotes are in local exchange time. Real-time last sale data for U.S. stock quotes reflect trades reported through Nasdaq only. Intraday data delayed at least 15 minutes or per exchange requirements.